1099-Q related question

[Sanbhu]

Thank you in advance for any useful advice on this issue.

Here's the situation and then the question: I'm the recipient (trustee) of my two kids' 529 plans (each has his/her own plans).  While one kid is still a dependent and I claimed under me and my wife's joint filing, the older kid doesn't qualify as a dependent, at least from tax purposes (not in reality). When completing the 1099-Q info asked in my older (non-dependent) child's tax return, TT said the recipient (i.e., me) owes taxes on that 1099-Q withdrawal. Here's the question: I'm not sure where do enter that info (earnings from the older child's 1099-!) in my tax return; your help is appreciated. 

Please note that all withdrawals are qualified and were used to pay for my child's college expenses (was not enough but still very helpful). 

Thank you!

Best wishes,

-Sanjib

[AmyC]

Do not enter the form. Tuck it into your tax folder.

IRS Publication 970, Tax Benefits for Education states:

If the entire 1099-Q went to qualified expenses, room and board, tuition, etc then you do not need to enter the form. Tuition paid for the first 3 months of the next year also qualify, see page 12, What Expenses Qualify, and page 52 for qualified distributions.

Page 45 repeats:  Don't report tax-free distributions (including qualifying rollovers) on your tax return.

[Sanbhu]

Thank you very much! Appreciated for the quick response. 

TT is very good at guiding "civilian" users like me who looks at tax only when it is this time of the year, but I still find TT's explanations of many tax-related items (e.g., 1099-Q) very confusing and full of legal jargons! Not surprisingly, I've reported 1099-Q last year (not sure why, I didn't think about reaching out to the community last year)! Additionally, I also forgot to report my kids' college expenses which were larger than the 529 used for their qualified expenses. Oh, well.. too late now. 

Thank you again! 

Best wishes,

-Sanjib

[AmyC]

Not too late. You should amend last year's tax return and add the qualified expenses or subtract the 1099-Q. See:

How do I amend my federal tax return for a prior year?

I need to amend my state return.

[Sanbhu]

oh, I didn't know that (shows my tax filing knowledge!). thank you! I will check that out.

Couple of quick questions, if you don't mind - 

(i) the link in your msg re amending previous year's filing ("How do I amend my federal tax return for a prior year?"), there's a bullet point that says, "Wait until your return has been accepted (or mailed if paper-filing)." - what does that mean? Does it mean wait until my current tax return (for 2023) is accepted?

(ii) Additionally, will my 2023 TT software read my 2022 TT file (with a *.tax2023 extension)? If so, I should be able to make the changes to ensure that I really need to amend (as highlighted in the link you sent and I do agree). 

Once again, thank you very much for your input and advice - very much appreciated!

Best wishes,

-Sanjib

[MarilynG1]

The 'wait until your return has been accepted' applies to Amending a current year return.

To amend a 2022 return,  you will need the TurboTax program for 2022 to open the .tax2022 file. 

Be sure to save a copy of your originally filed 2022 return.

If your changes in the Education section don't change your bottom line, you can cancel out of the amendment.

Here's more info on How to Amend Your Tax Return.

[Sanbhu]

ok, thank you again. 

Would you happen to know where I may find TT program to work on my 2022 TT file (*.tax2022 file)? I deleted last year's TT program from my computer before installing this year's (2023TT). 

Thanks for any info you may have. 

Best wishes,

-Sanjib

[MarilynG1]

Here's a link for 2022 Turbotax.   I keep several years version of TurboTax on my computer, just in case.  You could also save the old TurboTax programs on a removable drive, if you think they take up too much space. 

@sanbhu  

[Sanbhu]

Excellent - thank you very much!

I buy TT from Costco and delete the previous year's version and get rid of the older software as soon as buy the current year's version and install it (otherwise, TT desktop doesn't work).  Now that I learned my lesson (i.e., will have to buy the 2022 TT again!), I'll keep the 2023 software instead of deleting it next spring. 

Thank you again and you have a great week ahead!

-Sanjib

[DawnC]

You should not have to buy it again.   If you bought it from Costco, you should still have the installation disc; just reinstall it.   And if you buy it from Intuit, it remains in your download account.  

[Sanbhu]

Thank you but it was not a disc - Costco sells downloadable software only (same this year). I'll check my Recycle Bin before buying it again  - it may be there! Keeping my fingers crossed! 🙂

Best wishes,

-Sanjib

[Sanbhu]

TT is asking if your responses solve my problem - it did but there's no link to reply to that question; please advise. Thanks!

-Sanjib